14,718 research outputs found
Combining Spot and Futures Markets: A Hybrid Market Approach to Dynamic Spectrum Access
Dynamic spectrum access is a new paradigm of secondary spectrum utilization
and sharing. It allows unlicensed secondary users (SUs) to exploit
opportunistically the under-utilized licensed spectrum. Market mechanism is a
widely-used promising means to regulate the consuming behaviours of users and,
hence, achieves the efficient allocation and consumption of limited resources.
In this paper, we propose and study a hybrid secondary spectrum market
consisting of both the futures market and the spot market, in which SUs
(buyers) purchase under-utilized licensed spectrum from a spectrum regulator,
either through predefined contracts via the futures market, or through spot
transactions via the spot market. We focus on the optimal spectrum allocation
among SUs in an exogenous hybrid market that maximizes the secondary spectrum
utilization efficiency. The problem is challenging due to the stochasticity and
asymmetry of network information. To solve this problem, we first derive an
off-line optimal allocation policy that maximizes the ex-ante expected spectrum
utilization efficiency based on the stochastic distribution of network
information. We then propose an on-line VickreyCClarkeCGroves (VCG) auction
that determines the real-time allocation and pricing of every spectrum based on
the realized network information and the pre-derived off-line policy. We
further show that with the spatial frequency reuse, the proposed VCG auction is
NP-hard; hence, it is not suitable for on-line implementation, especially in a
large-scale market. To this end, we propose a heuristics approach based on an
on-line VCG-like mechanism with polynomial-time complexity, and further
characterize the corresponding performance loss bound analytically. We finally
provide extensive numerical results to evaluate the performance of the proposed
solutions.Comment: This manuscript is the complete technical report for the journal
version published in INFORMS Operations Researc
Characterizing Optimal Adword Auctions
We present a number of models for the adword auctions used for pricing
advertising slots on search engines such as Google, Yahoo! etc. We begin with a
general problem formulation which allows the privately known valuation per
click to be a function of both the identity of the advertiser and the slot. We
present a compact characterization of the set of all deterministic incentive
compatible direct mechanisms for this model. This new characterization allows
us to conclude that there are incentive compatible mechanisms for this auction
with a multi-dimensional type-space that are {\em not} affine maximizers. Next,
we discuss two interesting special cases: slot independent valuation and slot
independent valuation up to a privately known slot and zero thereafter. For
both of these special cases, we characterize revenue maximizing and efficiency
maximizing mechanisms and show that these mechanisms can be computed with a
worst case computational complexity and respectively,
where is number of bidders and is number of slots. Next, we
characterize optimal rank based allocation rules and propose a new mechanism
that we call the customized rank based allocation. We report the results of a
numerical study that compare the revenue and efficiency of the proposed
mechanisms. The numerical results suggest that customized rank-based allocation
rule is significantly superior to the rank-based allocation rules.Comment: 29 pages, work was presented at a) Second Workshop on Sponsored
Search Auctions, Ann Arbor, MI b) INFORMS Annual Meeting, Pittsburgh c)
Decision Sciences Seminar, Fuqua School of Business, Duke Universit
Truthful Assignment without Money
We study the design of truthful mechanisms that do not use payments for the
generalized assignment problem (GAP) and its variants. An instance of the GAP
consists of a bipartite graph with jobs on one side and machines on the other.
Machines have capacities and edges have values and sizes; the goal is to
construct a welfare maximizing feasible assignment. In our model of private
valuations, motivated by impossibility results, the value and sizes on all
job-machine pairs are public information; however, whether an edge exists or
not in the bipartite graph is a job's private information.
We study several variants of the GAP starting with matching. For the
unweighted version, we give an optimal strategyproof mechanism; for maximum
weight bipartite matching, however, we show give a 2-approximate strategyproof
mechanism and show by a matching lowerbound that this is optimal. Next we study
knapsack-like problems, which are APX-hard. For these problems, we develop a
general LP-based technique that extends the ideas of Lavi and Swamy to reduce
designing a truthful mechanism without money to designing such a mechanism for
the fractional version of the problem, at a loss of a factor equal to the
integrality gap in the approximation ratio. We use this technique to obtain
strategyproof mechanisms with constant approximation ratios for these problems.
We then design an O(log n)-approximate strategyproof mechanism for the GAP by
reducing, with logarithmic loss in the approximation, to our solution for the
value-invariant GAP. Our technique may be of independent interest for designing
truthful mechanisms without money for other LP-based problems.Comment: Extended abstract appears in the 11th ACM Conference on Electronic
Commerce (EC), 201
On the Legitimacy of Coercion for the Financing of Public Goods
The literature on public goods has shown that efficient outcomes are impossible if participation constraints have to be respected. This paper addresses the question whether they should be imposed. It asks under what conditions efficiency considerations justify that individuals are forced to pay for public goods that they do not value. It is shown that participation constraints are desirable if public goods are provided by a malevolent Leviathan. By contrast, with a Pigouvian planner, efficiency can be achieved. Finally, the paper studies the delegation of public goods provision to a profit-maximizing firm. This also makes participation constraints desirable.Public goods, Mechanism Design, Incomplete Contracts, Regulation
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